| Welcome to the July issue of the Dashboard Newsletter. Let me start by congratulating the mighty Black Caps on another good performance in a world cup cricket tournament. Sadly they fell at the last hurdle - again - but a stellar performance nonetheless. This result makes New Zealand the team that has reached the semi finals or beyond more times than any other team (tied with Australia). We have done this 8 out of the 12 world cups held, an absolutely remarkable record for little ‘ol New Zealand, a nation of only 5 million people. Stand proud!
For this month’s newsletter, I’m going to stick with the theme of population. World population growth has always been something that has fascinated me. It’s an absolutely tangible measure that affects virtually everything in our existence. And my interest in it is primarily to do with 2 aspects - environmental implications and economic implications. Whilst I spend a lot of time thinking about this, I haven’t gotten too much closer to making any sense of it. I do however have a few thoughts that I’ll share with you for you to consider. Before we consider the implications, let’s put the worlds population growth into context. The UN recently made a statement that there are more people alive today than have ever died in human history. This is an alarming quote, and I have heard it several times from various sources. However, it seems unfounded. It is estimated that humans have been in existence for about 52,000 years, and that the total number of humans to have ever lived is 105 billion (don’t ask me how they figure that out!). Today’s population is estimated at about 7.5 billion. So not quite more than have ever died, but still a very large percentage which only occurred in very recent times. However you look at it, the world’s population is growing at exponentially fast rates. The below graph puts this into perspective - it’s startling: 
So what does this mean? Well, from an environmental perspective this is terrifying. This is clearly not sustainable. Think of the implications on natural resources - water, air, food, minerals. Soon there won’t be enough to go around for everyone. Pollution is another obvious issue - not a day goes by where you don’t read or hear about a march or protest regarding straw island in the middle of the ocean, single use plastic bags, or flatulence tax. Fortunately, there are far smarter people than me obsessed with this issue and working tirelessly to find solutions - everything from re-usable straws to synthetic meat patties to making Mars habitable. Public awareness is also far greater now. So on this front, all we can do is try to manage our daily lives with these issues in mind, and hope that the guys and girls in the white coats come up with suitable solutions to solve these problems. But ironically, for all the same reasons that the environmental implications terrify me, the economic implications excite me. As the old saying goes, "Necessity is the mother of all invention". Humans are being forced out of complacency and into thinking differently about how we go about our business. It’s driving extraordinary innovation. Computers, the internet, electric cars, space travel, artificial intelligence, renewable energy, robotics, the list is endless. Think back over your lifetime and the changes that have taken place - things you would never have imagined which are now part of every day living. Now project yourself into the future and amplify that rate of change by 10. Imagine the possibilities. That’s the rate of innovation. Not only is there this incredible innovation revolution occurring in our lifetimes, but there are literally billions more people that need these goods and services. As the population grows, so does the need for toothpaste, smartphones, clothing, housing, <insert any good or service here>... The market is expanding, and well run companies which offer a quality product or service will grow with this market and prosper. From an economic and investment perspective, this has to spark some optimism in even the most pessimistic of doom-sayers. I have no idea how this all ends or whether economics wins out over environment or vice versa. But our small role in this is simply to consider our daily habits and actions in terms of environment, and seek out the opportunities in terms of economics. On balance, my glass is more than half full. In terms of the markets over the past 30 days, things have been mixed. Share markets have been extremely strong, all up between 1.5% and 4.6% for the month. New Zealand was the strongest market up 4.6%. However, this was partly off-set by a much stronger NZ$, up 2% against the US$ and 3% against the GB Pound, so off-shore investment returns were diluted by this. Term deposit rates continue to fall, and house prices remain more or less unchanged. Here are the numbers: |
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In terms of your Select Wealth Management portfolio, you should by now have received your June quarter performance report. I am pleased to confirm that performance was robust for the June quarter, following on from a very strong March quarter. In particular, the local listed property trusts did very well, as did the Australasian Share Market Funds. If you have any questions about your performance report or would like to get together to review your portfolio, please do not hesitate to contact me - we are here to help. Finally, a big thank you for all the referrals over the past 6 months to help us with Loren’s Giving Back campaign. Unfortunately we didn’t quite reach our target of $2,500, but we got close enough to put together a lovely “Baking Package Experience” for Loren. Thank You! For the second half of this year, we will be working with Hutt Valley Gymnastics to help them raise funds to build a new purpose-built gymnastics facility at Fraser Park. You can learn a bit more at www.mifinancialplanning.co.nz/giving-back.html. Once again, thank you so much for the referrals of your friends and family so that we can continue to fund this program - we really appreciate it. Warm regards Dave and the team at Isaacs Financial Planning dave@mifinancialplanning.co.nz |
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This newsletter is intended for general distribution and does not constitute personal financial advice. Copy of my primary disclosure statement and secondary disclosure statement.